Freqently asked questions

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frequently asked questions

Below are the answers to common initial questions many clients have when they first contact LALANDE EMPLOYMENT LAWYERS. We hope that the information below address many initial concerns you may have, but if you don’t find the answers here, please contact us with questions specific to your case. The consultation is free and confidential.

What does "wrongful dismissal" mean?

In every non-unionized employment relationship, the employer has an implied common law obligation to give the employee reasonable notice of its intention to terminate the employment relationship, unless there is just cause for termination. If the employer fails to give the employee reasonable notice of termination, the employee can bring a wrongful dismissal action for breach of that implied term.

How do I know if I have been wrongfully dismissed?

Your employer is obligated to provide you reasonable notice of your termination – or in the alternative – payment in lieu of such notice. If your employer has not provided you with reasonable notice OR payment in lieu of notice, or your employer has provided innapropriate notice then you may in fact have a claim for wrongful dismissal.

When does the obligation to provide reasonable notice NOT apply?
The employer’s obligation to provide the employee with reasonable notice of termination does not apply where:
  • The employee resigns his employment;
  • The employment relationship is frustrate;
  • There is just cause for termination of employment;
  • The employment contract contains a valid term providing for the amount of notice to be given in the event of termination;
  • The employment contract is for a fixed term.
How does the employer determine it's liability for reasonable notice?
There are two steps to determining the employer’s liability for reasonable notice:
  • First, the employer must determine the period of reasonable notice. There is no definitive catalogue or list that will guide in assessing reasonable notice in a particular case. The most important considerations are the Bardal factors, however, other factors may also be considered.
  • Second, the employer must calculate the employee’s damages based upon the reasonable notice period. Reasonable notice damages are usually calculated on the basis of the employee’s compensation per month, multiplied by the number of months of reasonable notice. There may be deductions from the damages for mitigation income and collateral benefits.
Are independent contractors entitled to reasonable notice?

No, independent contractors are not entitled to common law reasonable notice of termination.

What are dependant contractors?
Dependent contractor are workers who cannot be considered employees, but who are economically dependent on a single client company.
Dependent contractors are similar to employees in that they are entitled to reasonable notice of the termination of the working relationship, in recognition of their economic dependence on a single employer. They can be awarded notice periods that are similar to those given to employees.
What is the purpose of reasonable notice?

The purpose of providing reasonable notice is to allow the employee a period of time in which to secure alternative employment

Can my employer and I contract out of reasonable notice?

Yes, unlike statutory minimum termination pay, you can certainly contract out of reasonable notice. As a substitute for common law reasonable notice, you and your employer might have agreed at the outset to any amount of notice or pay in lieu of notice that is equal to or above the statutory minimum.

What are the Bardal Factors?

The starting point for determining the reasonable notice period is set out in an old seminal case case called Bardal v. Globe & Mail Ltd., from 1960. Bardal tells us that reasonable notice is decided with reference to the certain  key factors (the “Bardal factors”):

  • The character of the employment;
  • The employee’s length of service;
  • The employee’s age;
  • The availability of similar employment, having regard to the experience, training and qualifications of the employee.

Bardal lists the most important factors to be considered in assessing the common law reasonable notice period. These factors are weighed and balanced by the courts in their analysis. No single Bardal factor is to be given disproportionate weight.

It’s important to understand that Bardal does not provide an exhaustive list of the factors to be considered. Courts have added other factors into the analysis. However, additional factors are not given the same weight as the Bardal factors, except (arguably) for the factor of inducement.

Is there an upper limit of reasonable notice that can be awarded?

The reasonable notice period has been generally capped at a rough upper limit of 24 months of notice, with the court awarding above 24 months if exceptional circumstances are demonstrated.

For example, in the case of Dawe v. Equitable Life Insurance Company, 2018 CarswellOnt 8419 (Ont. S.C.J.) a 62-year-old senior vice president with 37 years of service was awarded 30 months of notice. The court would have awarded 36 months on the basis that no comparable employment was available however only 30 months of notice was claimed.

Is the "one month per year" rule of thumb accurate?

This approach has been rejected by the appeal courts as it overemphasizes the length of service factor and undermines the flexibility of the Bardal analysis.  The rule of thumb approach to reasonable notice also has little correlation to reality. Short term employees may well receive reasonable notice in excess of a month per year of service (sometimes up to four or five months per year of service) and longer-term employees (over 20 years) tend to receive less than a month per year of service.

When calculating notce, what is the definition of a "month"?
The reasonable notice period is usually expressed as a number of months. The definition of a month as it relates to the beginning and end dates of the notice period can be a key issue in calculating an employee’s reasonable notice damages.
For example, where an employee is entitled to damages for any bonus arising during the reasonable notice period, and the employee’s bonus vests of a specific date, the employee’s entitlement may turn on the precise calculation of that notice period down to a single day.
There are two ways to view the length of one month:
  • A standard period of days. In this approach a month would either be treated as 30 or 31 days.
  • A calendar month. In this approach December 5 to January 5, and January 5 to February 5 would both be treated as one month despite containing a different number of days.
An Ontario court has held that a month of reasonable notice is a calendar month. This method is “clear, simple and accords with common sense and everyday experience”.
What are the Bardal Factors?
The Bardal factors are the most important factors considered in assessing reasonable notice. The Bardal factors are:
  • Character of the employment.
  • Length of service.
  • Age.
  • Availability of similar employment, having regard to the experience, training and qualifications of the employee.
Reasonable notice is determined on a case by case basis. No one Bardal factor is given disproportionate weight in the analysis.
Some of the Bardal factors are interrelated, and the emphasis placed on them varies depending upon the state of the job market and the court’s perception of workers of a certain age or expertise. For example, the significance of the character of the employment relates at least in part to the availability of replacement employment, and the emphasis on age in part reflects a perception that people of certain ages may have more success or difficulty in obtaining replacement employment, particularly in cases of long service in which the employee has not been required to seek out new employment for considerable time.
How does one assess the "character of employment" in relation to reasonable notice??

In considering the character of employment, the courts are more concerned with the responsibilities, skills and character of the work performed rather than the minutia of the employee’s job duties or the employee’s job title.

In the past many courts assumed that senior level employees with a high degree of management functions or professional skills would have a harder time finding alternative employment and, as a result awarded greater reasonable notice for more senior level positions than for lower level or non-skilled positions. However, in the last 20 years Appeal Courts have considered the character of employment factor as one of “declining” importance or significance in the reasonable notice assessment. The character of employment factor is relevant to the reasonable notice analysis, but it is not to be given disproportionate weight (See Keays v. Honda, 2008)

How does one assess the "length of service" in relation to reasonable notice?

Long term employees are typically entitled to longer notice periods than short term employees of the same age, with the same skills and responsibilities.

Normally, the length of an employee’s service is easy to determine: it is the period between hiring and termination. However, this determination becomes more difficult if there has been a break in the employee’s tenure of service or there has been a sale of the business.
Changing employment status may also complicate the assessment of length of employment. A court may consider prior service as a dependent contractor in addition to service as a true employee in the calculation of the reasonable notice period.
How is a "gap in service" assessed in relation to reasonable notice?
The length of service may be difficult to determine when the employment relationship has not been continuous.
In general, if the employment has been interrupted for a lengthy period of time (for example, where an employee leaves to work for another employer) the length of service will run from the date of the rehiring and not the prior hiring date.  The longer the period of interruption in service, the less likely the court will consider the period of prior service in its assessment of reasonable notice.
The court, however,  has the discretion to disregard a gap in service when considering the employee’s length of service and may examine the gap in the context of the entire employment period.
How is my "age" assessed for the purpose of calculating reaonable notice?
Older employees are generally entitled to longer reasonable notice than younger employees, based on the rationale that it will take an older employee longer to find new employment. The court will take judicial notice that:
“Barring specific skills, it is generally known that persons over 45 have more difficulty finding work than others. They do not have the flexibility of the young, a disadvantage often accentuated by the fact that the latter are frequently more recently trained in the more modern skills”.
McKinney v. University of Guelph, 1990 CarswellOnt 1019 (S.C.C.)
The fact that an employee is nearing a normal retirement age, and presumably has less working years left, does not reduce the reasonable notice period. On the other hand, the notice period is not increased to the point that the employee will receive reasonable notice for life or until he retires.
If there is a term in the employment contract requiring the employee to retire at a certain date, the reasonable notice period will not extend past that retirement date because the employee will not have had the contractual right to continue to be employed by the employer beyond that date.
Note that dismissing an older employee who is near normal retirement age may lead to a human rights claim.
Like other factors, age should not be given disproportionate weight in the Bardal analysis. For example, it is improper for the court to set reasonable notice as the time-period needed to bridge an older employee to the date he would be entitled to a full pension.
How is the "availability of similar employment" factored into assessing reasonable notice?

The court may increase the amount of reasonable notice where there is limited similar employment available in the job market, having regard to the experience, training and qualifications of the employee. On the other hand, where similar employment is widely available, less notice may be awarded.

This is conceptually different than the time taken to find a new job. Reasonable notice is determined by the circumstances existing at the time of termination and not by the time that it takes to find alternative employment (which goes to the duty to mitigate and not to the length of reasonable notice). See Holland v. Hostopia.Com Inc., 2015 CarswellOnt 16985 (Ont. C.A.)

 

Is inducement a factor in assessing reasonable notice?

Yes, it is. The Supreme Court of Canada has expressly recognized that inducement is a factor to be considered in the reasonable notice analysis. Have a read of our blog post about inducement about how the inducement factor comes into play when en employee has left a relatively secure job.

What are bad faith/moral damages?

These are extra-contractual damages. Terminating an employee in a manner that is unfair or is in bad faith by being untruthful, misleading or unduly insensitive may result in additional damages being awarded to the terminated employee. Read more here.

How is rthe "sale of a business" determined in relation to reasonable notice?

It depends if there has been a merger or a take-over/asset purchase.  Normally, if there is a share purchase, the ownership of the company changes but not the legal identity of the employer. There is no termination of employment as the employment relationship flows through to the purchaser and the length of service is not interrupted.  If there is an asset purchase, the legal identity of the employer changes. The sale may terminate the employee’s employment with the vendor. The employment relationship does not automatically transfer to the purchaser. There is no common law right of assignment.

What if the purchaser of a business does not offer employment to the employee in an asset purchase??

If the purchaser of a business does not offer employment to existing employees, the vendor remains liable for reasonable notice damages based upon the employee’s length of service with the vendor. See Addison v. M. Leob Ltd., 1986 CarswellOnt 836 (Ont. C.A.).

What happens if the purchaser hires the vendor's employees in an asset purchase?

If the purchaser hires the vendor’s employees, a new employment contract is created. Unless there is an express contractual term to the contrary, the court will imply a term into the new employment contract giving the employee credit for his past service with the vendor and the prior years of service will be considered in the determination of the common law reasonable notice period. See Sorel v. Tomenson Saunders Whitehead Ltd., 1987 CarswellBC 175 (B.C. C.A.)

Do new employment contracts with the purchaser need to provide for he continuation of the employee's length of service?

In every jurisdiction, minimum standards legislation provides for the continuation of the employee’s length of service where the employee has continued employment with the purchaser after the sale or transfer of a business, particularly when it comes to issues of vacation entitlements and termination notice requirements. Any contract purporting to waive service credit for minimum standard purposes will be void. See Kerzner v. American Iron & Metal Inc., 2018 CarswellOnt 20637 (Ont. C.A.)

What is working notice?

The employer may choose to provide the employee with working notice of the termination of his employment. In this case, the termination letter would be given to the employee in advance of the actual termination date and expressly provide a final termination date that reflects the end of the applicable notice period.

Should you sign a release if you have been provided working notice?

Not typically. A release should not be used where the employee is given only working notice of his termination. If the employer offers additional payments over and above any minimum standards obligations (for example, the amount of working notice will not cover the entire reasonable notice period), it may require the employee to execute a release in exchange for the additional payments over minimum standards requirements.

What is a lump sum termination payment?

In many cases, the employer notifies the employee that the employment relationship is terminated effective immediately and offers the employee pay in lieu of notice, either in the form of a lump-sum package or as a salary continuance package. Lump-sum packages are typically structured so that the employee receives a fixed sum, with no reduction for mitigation income earned during the notice period.

Is a release typically signed if the employee receives a lump sum payment?
Lump-sum packages are typically offered on the condition that the employee executes a full and final release for amounts over his minimum standards or contractual entitlements. The employer cannot require that the employee execute a release for statutory termination pay or severance pay.
If the employee is provided with a lump-sum payment and no release is executed, the employee may bring an action for further notice at the end of the period of notice covered by the lump-sum package.
What is severance pay?

Severance pay is a payment that is made by the employer upon termination of an employee, in addition to any individual notice of termination and group termination notice. Where notice of termination is meant to give an employee an opportunity to prepare for an upcoming termination and take measures to seek alternative employment, severance pay is meant to compensate the employee for the investment of her long service with the employer’s business.

Can severance pay be given as working notice?

Severance pay cannot be given as working notice and must be given as additional pay upon termination. The employer is required to pay the employee her total severance pay amount even where it provides greater than the minimum required amount of working termination notice. (Mattiassi v. Hathro Management Partnership.)

In Ontario, a termination clause that gives the employer the option to provide severancepay as working notice, in part or for the entire severance pay entitlement, will likely be unenforceable for contracting out of the Employment Standards Act, 2000, S.O. 2000, c. 41. (Wood v. Fred Deeley Imports Ltd.)

Is severance pay deductible from common law reaonable notice?

Yes, Any severance pay paid to the employee is deductible from her common law reasonable notice entitlement. See Stevens v. Globe & Mail, 1996 CarswellOnt 1590 (Ont. C.A.) and Brake v. PJ-M2R Restaurant Inc., 2017 CarswellOnt 7619 (Ont. C.A.).

Can I transfer an amount of my salary continuance into an RRSP?

No, amounts paid as continuing salary will not qualify as a retiring allowance pursuant to Section  248(1) of the Income Tax Act and therefore cannot be transferred into an RSP or RRSP for the purpose of the deferral specified in Section 60(j.1).

Are your consultations free?

We typically offer a free phone conversation to see if we can help you with your particular situation. If we determine that we can be of assistance, we will invite you for an in-office consultation. At this point the in-office consultation will be invoiced to you to pay when we meet, or in the alternative, at the conclusion of your case, depending on your particular scenario.

What is Constructive Dismissal?

Constructive dismissal occurs when the employer acts in a way that demonstrates that it no longer wishes to be bound to the employment relationship or the employer breaches a fundamental term of the employment contract. Even if the employee resigns, in a constructive dismissal scenario, the employer will be deemed to have dismissed the employee without just cause, and the employee may be entitled to bring a wrongful dismissal action for reasonable notice damages as a consequence

I've heard that the maximum notice payable is 24 months - is this true?
Generally, only exceptional circumstances will support a notice period in excess of 24 months.
Very long term unskilled non-managerial employees may be considered for notice beyond 24 months.
Who proves cause for termination?

The onus is on the employer to show cause for dismissal, “which must be misconduct of the most serious kind”.  It has also been stated that there “is a substantial onus on the defendant to prove just cause

What is the standrd of proof in termination for cause?

The employer has the onus of proving cause for summary dismissal on the balance of probabilities.  The degree of proof, however, has been higher where the case involved an allegation of dishonest conduct or a breach of trust. While a civil court did not adopt so high a degree as a criminal court, it did require a degree of probability which was commensurate with the occasion.

What is the Test for Determining Cause?
One of the best practical definitions that the author has seen as to what constitutes cause for discharge is as follows:
. . . absent a flagrant dereliction of duty, it must be shown that something was done clearly inconsistent with the proper discharge of the employee’s duties that reasonably indicates a risk of injury to the employer’s interest through continued employment.
The employer has a high onus to discharge. To discharge this onus, each case must be viewed in its own unique set of circumstances. It has been held that “just cause” in the circumstances of the Saskatchewan Labour Standards Act is the same as in the common law test.9
Should my Employer have warned me before Firing me?

You should have been advised that whatever misconduct you’re accused of is a matter of serious significance and its continuation could place your employment in jeopardy. Unless a single act of misconduct is extremely serious toward immediate termination, which is quite rare, yes, your employer has a duty to warn you that your misconduct could result in dismissal for cause should further misconduct occur.

What if my Employer Fails to Warn me of my Misconduct?

The failure to warn an employee is considered to be condonation, accepting the improper behaviour (see Henry v. Foxco Ltd., 2004 CarswellNB 127 (N.B. C.A.) at paragraph 123

Can employee misconduct prior to his or her employment be utilized as the basis for summary discharge?

Generally, the misconduct of an employee prior to his or her employment cannot be utilized as the basis for summary discharge. The only exception to this rule is when an employee, in an attempt to obtain a job, misrepresents his or her background, skills or qualifications at the hiring stage. If such occurs, the company has a right to terminate the employee without notice or severance pay.

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